Consolidated financial statement information and group reporting in the central government: a user-oriented approach

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This study aims to fill the research gap regarding the usability of group reporting information in the central government. It answers the question of how the consolidated information should be formed to benefit the real needs of governmental information users.

The empirical research is based on a survey and interviews among key internal preparers and users in the central government sector in the case country, Finland.

Results show that the private sector approach regarding consolidation is not appropriately transferable to the central government sector. The key stakeholders identified several economic and financial reporting needs that exceed what formal Consolidated Financial Statement (CFS) can offer. Consolidation is needed but not according to the extensive full control approach, but rather following the budgetary approach consolidating units of the legal person of the government, and further using the partial control approach for consolidating by discretion essential special purpose SOEs.

Research limitations/implications
Respondents and interviewees represented governmental internal organisations, free experts, auditors and financial managers from the group entities. Politicians and citizens were not directly represented.

Practical implications
Research gives applicable insights into central governments planning and developing group reporting for information needs in a favourable cost-benefit ratio. Findings benefit the development of EU's EPSAS (European Public Sector Accounting Standards) project which is still incomplete.

Social implications
Research recommends governments to make a thorough analysis before deciding on a new financial reporting system. A critical analysis prevents governments to waste money and resources on a reporting system not fulfilling the real needs of information users.

The value of this research is that the private sector approach in consolidation was not taken as granted. This study investigated critically and empirically the real need for consolidated information serving steering and overseeing purposes of the government's group entities.
Original languageEnglish
Pages (from-to)28-51
Number of pages24
JournalJournal of Public Budgeting, Accounting and Financial Management
Issue number6
Early online date30 Dec 2022
Publication statusPublished - 2023
Publication typeA1 Journal article-refereed


  • A user-oriented approach
  • Consolidation in the central government
  • Group information needs
  • Limiting the sphere of consolidation

Publication forum classification

  • Publication forum level 1


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